GM to reinstate 600 dealerships slated to be cut

Looks like being an election year for some senators and congress that
the money flow is getting tight now that the uber-rich have their
bailouts. So GM can't just stall and welsh on the pending lawsuits from

dealers getting the shaft.
So mostly democrat congressmen are trying to cover their asses before
November 2010 and hoping people forget about the great American sellout.
So if you don't want to keep paying taxes to corporations and
corruption, time to change some politicial heads in DC.
Funny how Govenment Motors polishes it's turds.
--------
NEW YORK (AP) -- General Motors Co. will reinstate 661 dealerships it
sought to drop from its sales network.
GM executives said Friday that the dealerships -- more than half of
those seeking to stay with the automaker -- will receive letters giving
them the option to remain open. GM said it would not have enough time to
negotiate with all 1,100 dealerships that appealed the automaker's
decision to close them within a four-month window imposed by the federal
government.
"By doing this we save a lot of time, energy and dollars," said Jim
Bunnell, GM general manager of network support, saying the company
wished to avoid a "very large arbitration process."
As part of its restructuring, GM last year told about 2,000 dealerships
it would not renew their franchise agreements once they run out in
October 2010. But the dealerships have said GM treated them unfairly,
and last month Congress passed a law requiring an appeals process for
the dealers.
GM's decision to keep the additional showrooms open effectively shrinks
the number of appeals it has to contend with. Arbitration hearings for
the dealers who didn't get offers but still want to stay with GM will
begin later this month.
The cuts to GM's 6,000-dealer network were designed to compensate for
much lower demand for cars and trucks, but some dealers have argued that
lots that are still profitable are at risk, and that the automaker
hasn't offered enough details about how it's choosing which businesses
to shutter.
GM would not offer any details on Friday about which dealerships it was
reinstating and where they are located. It said it chose the 661 based
on a variety of criteria, including sales and other business factors.
The company said it hoped to have every letter of intent with
dealerships by Monday. At that point, dealers have 10 days to respond
and 60 days to meet a set of criteria that would allow them to stay with GM.
A spokeswoman with Chrysler Group LLC, which has cut 789 dealers, said
the company was preparing a statement in response to questions about
whether they also intended to reinstate dropped dealerships. Chrysler
showrooms slated for closure are also appealing to stay open, though it
remained unclear how many.
Michael Boudreau, an auto industry turnaround expert with O'Keefe &
Associates, said GM likely saw the reinstatement of the dealers as the
"lesser of the two evils" versus the costs of litigating their termination.
"It's not exactly what they wanted to do, and it's always I think a
little embarrassing when you have to make changes based on an
arbitration process, but they've had to adjust and move forward," he said.
Boudreau added that the decision could have ripple effects.
"The Chrysler dealers are taking a close look at this," he said.
Tammy Darvish of the Washington-area Darcars chain, which has three
dealerships slated for closure, said she was encouraged by GM's decision.
"If they are genuinely, truly sincere, it's overwhelmingly
heartwarming," Darvish said of the company's offer to allow dealers to
demonstrate their eligibility to remain open.
But as of Friday, Darvish said she didn't know if her franchises are
among those being reinstated. She said she plans to go into arbitration
if they are not.
Congress-brokered talks between dealer groups and the automakers began
in September. But those talks stalled over disputes about the review
process for targeted dealerships and other issues. Looming over the
fight has been the threat of federal legislation to deal with the
closures. Lawmakers warned that if a deal wasn't reached, that
legislation would move forward.
The White House has opposed the legislation over concerns that it could
hurt GM's and Chrysler's efforts to rebound from their government-led
bankruptcies.
AP Business Writer Jordan Robertson contributed to this story from San
Francisco.

What GM (finally) realized was that you can't sell cars if you don't
have a dealer! Now, if the realization that even with dealers, they
will have to produce a competitive, quality product in order to be
able to sell them.

They seem to be waffling a bit. If it were the right decision to cut
the dealerships earlier, it is probably still the right decision.
Are they just pandering to political correctness? If so, that is a path
to doom I have seen others follow in the past.

Read the fine print in the agreement, upgrade facilities etc.
I only know of one buick dealer closed in my area and it was a dump.
2 chrysler dealers also closed were dumps one was one of the dealers at the
hearings his dealership was a joke.

Log in

Motorsforum.com is a website by car enthusiasts for car enthusiasts. It is not affiliated with any of the car or spare part manufacturers or car dealers discussed here.
All logos and trade names are the property of their respective owners.